The Brent and WTI benchmarks were trading at their highest levels since July and August respectively and were on the verge of posting weekly gains of 1.6% and 1.7%.“Uncertainty prevails, fear is driving prices higher today,” said Tamas Varga, an oil analyst at brokerage PVM. “It is completely driven by the outcome of the Iranian nuclear talks and possible military action the US could take against Iran.”
The United States and Iran held indirect talks in Geneva on Thursday after US President Donald Trump ordered a military build-up in the region.
Oil prices rose more than a dollar a barrel during the talks following media reports that showed discussions had stalled over America’s insistence on Iran’s zero enrichment of uranium. However, prices fell after the Omani mediator said the two sides had made progress in talks.
They plan to resume negotiations with technical-level discussions scheduled for next week in Vienna, Omani Foreign Minister Sayyid Badr Albusaidi said on
Trump said on February 19 that Iran must make a deal on its nuclear program within 10 to 15 days or “really bad things” will happen.
Geopolitical risk premiums of $8 to $10 a barrel have pushed oil prices higher on fears that a conflict will disrupt supplies from the Middle East through the Strait of Hormuz, through which about 20% of global oil supplies pass, Sarkar said.
To cushion the impact of a possible attack, Saudi Arabia is increasing oil production and exports, two sources familiar with the plans told Reuters.
Producer group OPEC+, meanwhile, is likely to consider raising oil output for April by 137,000 barrels per day at its March 1 meeting, sources said, after suspending production increases in the first quarter.
(Reporting by Anna Hirtenstein in London Additional reporting by Florence Tan in Singapore and Nicole Jao in New York Editing by David Goodman and Louise Heavens)
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